House Bill 1652

AN ACT TO PROVIDE THAT THE MISSISSIPPI DEVELOPMENT AUTHORITY
SHALL NOT ADMINISTER LOANS OR GRANTS OF FEDERAL OR STATE FUNDS FOR A CERTAIN
PERIOD OF TIME TO POULTRY PROCESSORS WHO HAVE BEEN CITED BY THE UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY AS KNOWINGLY HAVING VIOLATED THE FEDERAL CLEAN
WATER ACT; TO AMEND SECTION 57-61-14, MISSISSIPPI CODE OF 1972, TO REMOVE THE
SALES TAX EXEMPTION FOR CERTAIN COMPANIES IN VIOLATION OF THE FEDERAL CLEAN
WATER ACT; TO AMEND SECTIONS 57-61-9 AND 57-61-11, MISSISSIPPI CODE OF 1972, TO
PROVIDE THAT CERTAIN PRIVATE COMPANIES THAT ARE IN VIOLATION OF THE FEDERAL
CLEAN WATER ACT SHALL PAY A PENALTY ON THE REMAINING PORTION OF THEIR LOANS
UNDER THE MISSISSIPPI BUSINESS INVESTMENT ACT; TO AMEND SECTION 27-65-111,
MISSISSIPPI CODE OF 1972, IN CONFORMITY THERETO; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE
STATE OF MISSISSIPPI:

SECTION
1. For a period of ten (10)
years from the date that a poultry processor is cited by the United States
Environmental Protection Agency as knowingly having violated the federal Clean
Water Act (33 USCS 1251 et seq.), the Mississippi Development Authority shall
not administer loans or grants of federal or state funds for the benefit of
such processor under the Mississippi Business Investment Act or the Community
Development Block Grant Program. After
the ten-year period, the Mississippi Development Authority may make loans to
such processors but shall assess a penalty of two percent (2%) greater than the
current prime rate on the amount of the loan payable by the processor in
monthly installments.

57-61-9.
(1) Any private company desiring
assistance from a municipality shall submit to the municipality a letter of
intent to locate, expand or build a facility entirely or partially within the
municipality or on land the municipality is authorized to own or otherwise
acquire. The letter of intent shall
include:

(a)
Except for strategic investments, a commitment that the proposed project
will create and maintain a minimum of ten (10) net new full-time equivalent
jobs, will create and maintain at least a five percent (5%) increase in full-time
equivalent jobs in the case of expansion of an enterprise already located at
the site or at least a twenty-five percent (25%) increase in full-time
equivalent jobs pursuant to subsection (9) of Section 57-61-15 and will create
and maintain at least one (1) net new full-time equivalent job for every
Fifteen Thousand Dollars ($15,000.00) either loaned or granted for the
project. The commitment required by
this paragraph (a) shall include any jobs created prior to the effective date
of this chapter resulting from contracts entered into contingent upon
assistance being made available under this chapter. All jobs required to be maintained by this paragraph (a) shall be
maintained until such time as any loan made under this chapter for the benefit
of a private company is repaid. The
letter of intent shall include a statement that the private company understands
that if it is cited by the United States Environmental Protection Agency as
knowingly having violated the federal Clean Water Act, the company shall be
liable for a penalty of two percent (2%) greater than the current prime rate on
the remainder of the loan made for its benefit.

(b)
A statement that the specific improvements are necessary for the
efficient and cost-effective operation of the private company, together with
supporting financial and engineering documentation.

(c)
Any commitment to pay rental on, or to make loan repayments related to,
the improvements to be made with funds loaned to a municipality under this
chapter.

(d)
If required by the Mississippi Development Authority, a notarized
statement of willingness to grant a lien on the facility for which the
improvement is being provided, in an amount and a manner to be determined by
the Mississippi Development Authority, which lien may be foreclosed in
the event that the private company fails to operate in the facility according
to the terms of the agreement and/or to collateralize the loan made for the
benefit of the private company for which the improvement is being provided in
an amount and manner to be determined by the Mississippi Development
Authority. In the event the
contractual agreement is to be entered into with a department or subsidiary of
the United States government, the Mississippi Development Authority
shall determine that the governmental unit will operate the proposed project
for a sufficient number of years to retire the loan based on increased revenue
estimates by the University Research Center and any agreement entered into
shall reflect that the interest paid on any loan for such purpose shall be
included in Mississippi's contributory value in the project. In the event the private company requesting
the assistance is a subsidiary of another corporation, if required by the Mississippi
Development Authority, any contractual agreement entered into shall also
require the parent company to unconditionally warrant the performance of the
subsidiary in carrying out the terms of the agreement or it shall require the
subsidiary and/or the parent company to pledge assets in an amount and a manner
to be determined by the Mississippi Development Authority and/or to
collateralize the loan in an amount and a manner to be determined by the Mississippi
Development Authority to ensure the performance of the terms of the
contract.

(2)
Upon receipt of the letter of intent from a private company, the
municipality may apply to the Mississippi Development Authority for a
loan or grant. The application from the
municipality shall include but not be limited to:

(a)
A statement of the purpose of the proposed loan or grant, including a
list of eligible items and the cost of each.

(b)
A statement showing the sources of funding for the entire project,
including the private company's or governmental unit's investment in the
project and any public and other private sources of funding.

(c)
A certified copy of the signed letter of intent from a private company
or governmental unit, as specified in this section.

(d)
Evidence that there will be a private match of at least Three Dollars
($3.00) for every One Dollar ($1.00) of state assistance, except in the case of
ports where the private match will be at least Two Dollars ($2.00) for every
One Dollar ($1.00) of state assistance.

(e)
Demonstration that the private company is financially sound and is
likely to fulfill the commitments made in its letter of intent.

(f)
A proposed timetable for the provision of the improvements.

(g)
Evidence that the project will be expeditiously carried out and
completed as planned.

(h)
A demonstration that insufficient local capital improvement funds at reasonable
rates and terms are available within the necessary time to provide the needed
improvement on public property. This
includes local funds available through issuance of bonds or other means, state
funds available through existing programs, and available federal program funds
such as community development block grant funds, urban development action grant
funds, and economic development administration funds.

(i)
A demonstration that insufficient private funds are available at
reasonable rates and terms within the necessary time to fund improvement on
property owned by the private company.

(3)
The Mississippi Development Authority shall consider grant and
loan applications based on the following criteria:

(a)
The number of net new full-time equivalent jobs that will be provided
and the amount of additional state and local tax revenue estimated by the
University Research Center to be directly generated by the private company's
new investment, and additionally, as to loan applications by state agencies,
the extent to which shipping through the port will be increased by the proposed
port development projects, the degree to which jobs will be increased in the
port area and the impact on port revenues.

(b)
The ability to repay the principal and interest, in the case of a loan,
based on increased revenue estimates and any revenue-producing provision of a
contractual agreement.

(c)
The increase in the employment base of the state.

The Mississippi Development Authority
and the University Research Center may use the resources and capabilities of
the planning and development districts in carrying out the provisions of this
chapter.

(4)
No loan shall be made in excess of the amounts which can be repaid with
the increased revenues estimated by the University Research Center, provided
that this subsection (4) shall not apply to loans in connection with a United
States Navy home port.

(5) (a)
Notwithstanding anything contained in this chapter, an agency of the
State of Mississippi operating a state-owned port, and hereinabove identified
as a "municipality" and "governmental unit" for purposes of
this chapter, may make application for a loan or grant under the terms and
provisions of this chapter. In
addition, a public agency operating a port bordering on the Gulf of Mexico,
which shall be considered to be a "municipality" or a
"governmental unit" for the purposes of this chapter, may make
application for a loan or grant under the terms and provisions of this chapter
from funds other than those funds authorized for a state-owned port under
paragraph (e)(iii) of Section 57-61-11.
The application shall be initiated by submission of a letter of intent
to engage in a project or projects for the purpose of effecting enlargement and
improvement in all facilities used and useful in attracting international and
foreign commerce through the port.
Projects eligible for inclusion in the letter of intent may include, but
not be restricted to:

(i) Dredging and deepening the access channel and harbor basin of the
port;

(ii) Effecting the enlargement of the land area of the port by
reclamation;

(iii) Construction and installation of piling, bulkheads, docks,
wharves, warehouses and appurtenances; and

(iv) Acquisition of facilities and equipment for handling bulk and
containerized cargo.

(b)
With respect to a state-owned port bordering on the Gulf of Mexico, the
letter of intent shall include the following information and any other
information required by the Mississippi Development Authority:

(i) Present and future annual tonnages expected as a result of the
improvements.

(ii) Reasons why present facilities are inadequate to enable the port
to compete, including limitations imposed by insufficient depth of channel and
basin.

(iv) Comparison of the percentage of the world's cargo shipping that
can now be accommodated with what could be accommodated with project
improvements.

(v) Economic contribution to the region and state resulting from
increased shipping activity.

(vi) Statement of degree to which port revenues are expected to be
increased as a result of projects.

(vii) Financial data of port activities, including cost of project,
degree of federal funding available and required local participation.

On or before January 1, 1989, a state-owned
port described in this paragraph (b) shall submit to the Senate Finance
Committee and the House Ways and Means Committee of the Mississippi Legislature
a comprehensive, written report updating for each committee the information
listed in items (i) through (vii) of this paragraph (b) with particular
emphasis on the economic contribution to the region and state by shipping
activity at the port; on financial data with respect to the degree of federal
funding available and local participation in funding port activities; and on
progress made in dredging and completing other improvements necessary to
accommodate modern shipping.

(c)
The Mississippi Development Authority shall consider grant and
loan applications based on the following:

(i) The extent to which shipping through the port will be increased
by the proposed projects.

(ii) The degree to which jobs will be increased in the port area.

(iii) Impact on port revenues.

(iv) The ability of the port to repay interest and principal in the
case of a loan.

(6)
A municipality may apply to the Mississippi Development Authority
for a grant under the terms and provisions of this chapter, and the Mississippi
Development Authority may award grants to a municipality subject to
limitations contained in this chapter.
The application shall be initiated by submission of a letter of intent
to engage in a project or projects for the purpose of providing improvements
necessary to accommodate a United States Navy home port.

(7)
The Legislature hereby finds and determines that financing facilities
necessary to accommodate a Navy home port serves a valid public purpose in that
a Navy home port will significantly contribute to the employment base of the
state which is in great need of assistance; provided, that in the event such
facilities are no longer required for use by the Navy as a home port, such
facilities shall revert as provided in Section 59-9-21.

(8)
Notwithstanding any provision or requirement of this chapter to the
contrary, a municipality may make application for a loan under this chapter, in
an amount not to exceed Five Million Dollars ($5,000,000.00), for the purpose
of acquiring and developing land to be used as a technology/industrial park for
which there is a binding commitment by one or more private companies to create
and maintain not less than an aggregate of three hundred (300) jobs meeting
minimum criteria established by the Mississippi Development Authority. Such a commitment by a private company shall
not disqualify the private company from obtaining assistance under this
section. The match requirements of this
section shall not apply to any loan made pursuant to this subsection (8).

(9)
(a) A municipality is authorized
to negotiate a contract for the acquisition, construction and erection of a
project or any portion of a project hereunder where a municipality finds that,
because of the particular nature of a project or any portion thereof, it would
be in the best public interest of the municipality to negotiate.

(b)
Contracts by a private company for the acquisition, construction or
erection of a project which receives assistance under this chapter shall be
effected in the manner prescribed by law for public contracts, unless the Mississippi
Development Authority makes a written finding that, because of special
circumstances with respect to the projects or any portion thereof, it would
better serve the public interest or more effectively achieve the purposes of
this chapter to enter into such contracts based on negotiation.

(10)
A municipality is authorized upon such terms and conditions as the
municipality may deem advisable, provided such terms and conditions shall not
be in conflict with the provisions of this chapter, to (a) acquire, whether by
construction, purchase, gift or lease, all of or any portion of a project
hereunder; (b) to lease or sell to others all of or any portion of a project
hereunder; and (c) to lend to the private company the proceeds of the loan from
the board to such municipality.

(11)
All agreements between a municipality and a private company related
directly or indirectly to a project or a portion of a project to be funded in
whole or in part under this chapter are subject to approval by the Mississippi
Development Authority.

57-61-11.
The Mississippi Development Authority shall establish such
guidelines, rules and regulations for the repayment of funds loaned pursuant to
this chapter as may be necessary. These
provisions shall include but not be limited to the following:

(a)
Funds may be loaned for a maximum of ten (10) years or the estimated
useful life of the property as established by the United States Department of
Treasury, whichever is greater.

(b)
The rate of interest charged by the Mississippi Development Authority
for improvements not on publicly owned property may be negotiated by the Mississippi
Development Authority. Private
companies that are cited by the United States Environmental Protection Agency
for knowingly having violated the federal Clean Water Act shall be liable for a
penalty equal to two percent (2%) greater than the current prime rate for the remainder
of the loans made for their benefit.
The penalty shall be payable in monthly installments.

(c)
For all improvements funded through this chapter which occur on publicly
owned property, repayment of funds loaned may, in the discretion of the Mississippi
Development Authority, involve only the principal amount loaned with no
interest charged thereon.

(d)
An audit by a certified public accountant of all costs of a project
hereunder must be submitted to the Mississippi Development Authority not
later than ninety (90) days after a project's completion. Such an audit shall certify that all of the
funds loaned or granted pursuant to this chapter were disbursed in accordance
with the terms of this chapter and shall be paid for by the private company benefited
by the project.

(e) Notwithstanding the
foregoing, in the case of an application under Section 57-61-9(5)(a), the
guidelines shall include but not be limited to the following:

(i) Funds may be loaned for a maximum of twenty (20) years, or the
estimated useful life of improvements on the land areas of the port, whichever
is greater.

(ii) The rate of interest charged by the Mississippi Development
Authority for loans for port projects may be negotiated by the Mississippi
Development Authority and shall be consistent with Section 57-61-11(b) and
(c).

(iii) The total of grants and loans to any one state-owned port made
pursuant to an application under Section 57-61-9(5)(a) shall not exceed Twenty
Million Dollars ($20,000,000.00).

(iv) Before any loan or grant may be made under Section 57-61-9(5)(a)
to a state-owned port bordering the Gulf of Mexico, the applicant shall make
adequate assurance to the Mississippi Development Authority that federal
participation in the cost of the project or projects has been committed
contingent only upon availability of local participation in accordance with
federal guidelines.

(v) Notwithstanding any provision of this chapter to the contrary,
the Mississippi Development Authority shall utilize not more than Five
Million Dollars ($5,000,000.00) out of the proceeds of bonds authorized to be
issued in this chapter to be made available as interest-bearing loans to state-owned
ports for the purpose of repairing, renovating, maintaining and improving the
state-owned port. The Mississippi
Development Authority shall establish an amortization schedule for the
repayment of any loans made pursuant to this subparagraph. The state-owned port shall not spend any
revenues for other purposes unless payments on the loan are being timely made
according to the amortization schedule.
The match requirements of this section and Section 57-61-9 shall not
apply to any loan made pursuant to this subparagraph.

(f) For a period of ten (10) years from the date that a private
company is cited by the United States Environmental Protection Agency as
knowingly having violated the federal Clean Water Act, the Mississippi
Development Authority shall not make any loan funds available under this
chapter to such company.

57-61-14.
In accordance with Section 27-65-111, purchases of tangible personal
property or services by a private company, as defined in this chapter, with
proceeds of bonds issued under this chapter, shall be exempt from sales
tax. If the private company is cited
by the United States Environmental Protection Agency as knowingly having
violated the federal Clean Water Act, the company shall not be exempt from
sales tax under this section for a period of ten (10) years from the date of
the violation.

27-65-111.
The exemptions from the provisions of this chapter which are not
industrial, agricultural or governmental, or which do not relate to utilities
or taxes, or which are not properly classified as one of the exemption
classifications of this chapter, shall be confined to persons or property
exempted by this section or by the Constitution of the United States or the
State of Mississippi. No exemptions as
now provided by any other section, except the classified exemption sections of
this chapter set forth herein, shall be valid as against the tax herein levied.
Any subsequent exemption from the tax levied hereunder, except as indicated
above, shall be provided by amendments to this section.

No exemption provided in this section shall
apply to taxes levied by Section 27-65-15 or 27-65-21, Mississippi Code of
1972.

The tax levied by this chapter shall not apply
to the following:

(a)
Sales of tangible personal property and services to hospitals or
infirmaries owned and operated by a corporation or association in which no part
of the net earnings inures to the benefit of any private shareholder, group or
individual, and which are subject to and governed by Sections 41-7-123 through
41-7-127.

Only sales of tangible personal property or
services which are ordinary and necessary to the operation of such hospitals
and infirmaries are exempted from tax.

(b)
Sales of daily or weekly newspapers, and periodicals or publications of
scientific, literary or educational organizations exempt from federal income
taxation under Section 501(c)(3) of the Internal Revenue Code of 1954, as it
exists as of March 31, 1975, and subscription sales of all magazines.

(c)
Sales of coffins, caskets and other materials used in the preparation of
human bodies for burial.

(d)
Sales of tangible personal property for immediate export to a foreign
country.

(e)
Sales of tangible personal property to an orphanage, old men's or
ladies' home, supported wholly or in part by a religious denomination,
fraternal nonprofit organization or other nonprofit organization.

(f)
Sales of tangible personal property, labor or services taxable under
Sections 27-65-17, 27-65-19, and 27-65-23, to a YMCA, YWCA, a Boys' or Girls'
Club owned and operated by a corporation or association in which no part of the
net earnings inures to the benefit of any private shareholder, group or
individual.

(g)
Sales to elementary and secondary grade schools, junior and senior
colleges owned and operated by a corporation or association in which no part of
the net earnings inures to the benefit of any private shareholder, group or
individual, and which are exempt from state income taxation, provided that this
exemption does not apply to sales of property or services which are not to be
used in the ordinary operation of the school, or which are to be resold to the
students or the public.

(h)
The gross proceeds of retail sales and the use or consumption in this
state of drugs and medicines:

(i) Prescribed for the treatment of a human being by a person
authorized to prescribe the medicines, and dispensed or prescription filled by
a registered pharmacist in accordance with law; or

(ii) Furnished by a licensed physician, surgeon, dentist or podiatrist
to his own patient for treatment of the patient; or

(iii) Furnished by a hospital for treatment of any person pursuant to
the order of a licensed physician, surgeon, dentist or podiatrist; or

(iv) Sold to a licensed physician, surgeon, podiatrist, dentist or
hospital for the treatment of a human being; or

(v) Sold to this state or any political subdivision or municipal
corporation thereof, for use in the treatment of a human being or furnished for
the treatment of a human being by a medical facility or clinic maintained by
this state or any political subdivision or municipal corporation thereof.

"Medicines," as used in this
paragraph (h), shall mean and include any substance or preparation
intended for use by external or internal application to the human body in the
diagnosis, cure, mitigation, treatment or prevention of disease and which is
commonly recognized as a substance or preparation intended for such use;
provided that "medicines" do not include any auditory, prosthetic,
ophthalmic or ocular device or appliance, any dentures or parts thereof or any
artificial limbs or their replacement parts, articles which are in the nature
of splints, bandages, pads, compresses, supports, dressings, instruments,
apparatus, contrivances, appliances, devices or other mechanical, electronic,
optical or physical equipment or article or the component parts and accessories
thereof, or any alcoholic beverage or any other drug or medicine not commonly
referred to as a prescription drug.

Notwithstanding the preceding sentence of
this paragraph (h), "medicines" as used in this paragraph
(h), shall mean and include sutures, whether or not permanently implanted,
bone screws, bone pins, pacemakers and other articles permanently implanted in
the human body to assist the functioning of any natural organ, artery, vein or
limb and which remain or dissolve in the body.

"Hospital," as used in this
paragraph (h), shall have the meaning ascribed to it in Section 41-9-3,
Mississippi Code of 1972.

Insulin furnished by a registered
pharmacist to a person for treatment of diabetes as directed by a physician
shall be deemed to be dispensed on prescription within the meaning of this paragraph
(h).

(i)
Retail sales of automobiles, trucks and truck-tractors if exported from
this state within forty-eight (48) hours and registered and first used in
another state.

(j)
Sales of tangible personal property or services to the Salvation Army
and the Muscular Dystrophy Association, Inc.

(k)
From July 1, 1985, through December 31, 1992, retail sales of
"alcohol blended fuel" as such term is defined in Section 75-55-5. The gasoline-alcohol blend or the straight
alcohol eligible for this exemption shall not contain alcohol distilled outside
the State of Mississippi.

(l)
Sales of tangible personal property or services to the Institute for
Technology Development.

(m)
The gross proceeds of retail sales of food and drink for human
consumption made through vending machines serviced by full line vendors from
and not connected with other taxable businesses.

(n)
The gross proceeds of sales of motor fuel.

(o)
Retail sales of food for human consumption purchased with food stamps
issued by the United States Department of Agriculture, or other federal agency,
from and after October 1, 1987, or from and after the expiration of any waiver
granted pursuant to federal law, the effect of which waiver is to permit the
collection by the state of tax on such retail sales of food for human
consumption purchased with food stamps.

(p)
Sales of cookies for human consumption by the Girl Scouts of America no
part of the net earnings from which sales inures to the benefit of any private
group or individual.

(q)
Gifts or sales of tangible personal property or services to public or
private nonprofit museums of art.

(r)
Sales of tangible personal property or services to alumni associations
of state-supported colleges or universities.

(s)
Sales of tangible personal property or services to chapters of the
National Association of Junior Auxiliaries, Inc.

(t)
Sales of tangible personal property or services to domestic violence
shelters which qualify for state funding under Sections 93-21-101 through 93-21-113.

(u)
Sales of tangible personal property or services to the National Multiple
Sclerosis Society, Mississippi Chapter.

(v)
Retail sales of food for human consumption purchased with food
instruments issued the Mississippi Band of Choctaw Indians under the Women,
Infants and Children Program (WIC) funded by the United States Department of
Agriculture.

(w)
Sales of tangible personal property or services to a private company, as
defined in Section 57-61-5, which is making such purchases with proceeds of
bonds issued under Section 57-61-1 et seq., the Mississippi Business Investment
Act, except as otherwise provided in Section 57-61-14, as amended by House
Bill No. , 2002 Regular Session.

(x)
The gross collections from the operation of self-service, coin-operated
car washing equipment and sales of the service of washing motor vehicles with
portable high pressure washing equipment on the premises of the customer.

SECTION
6. This act shall take effect and
be in force from and after July 1, 2002.